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Was 15% yield too good to be true?

PROPERTY experts are warning investors to be wary of get-rich-quick schemes that advertise double-digit returns from rental properties. They fear the plans, which usually invest in properties in the north of England, may not live up to their claims and will leave investors out of pocket.

The warning follows a Department of Trade and Industry (DTI) application to force Practical Property Portfolios, based in Newcastle, to wind itself up.

In return for an outlay of £24,000, the company offered to find and manage buy-to-lets for investors, mainly social housing in the north-east. Advertisements boasted of a potential 15% yield. The company even promised to pay the rent if your property remained empty for more than seven days.

But Practical Property Portfolios is now at the centre of a probe involving the police as well as the DTI. The investigation is understood to have been launched after investors complained that money